The Advantages and Disadvantages of Short Term Loans
People wanting to cover a loan debt in a short space of time, now have the opportunity to take out short term loans. Such loans are specially designed for a shorter paying term, and therefore do not require any long term obligations. The amounts borrowed are normally small amounts; as such loans need to be paid back quickly. Such loans are provided for purposes such as auto repairs, educational expenses, clearing small debts and home improvements.
There are various types of loans that include business loans, auto loans, payday loans and personal loans. Depending on the loan amount, this will define the actual repayment term. Your credit score will determine the loan conditions as the various different lenders may offer you different loan interest rates. The purpose of the loan, may also determine the repayment duration. Payday loans that are short term are also known as cash advance loans.
Payday loans which include military payday loans have to be paid back by your next pay check, and once the loan has been approved it is paid into your account within hours or overnight. Such loans will determined by your credit history and the years of experience served in the military.
The advantages of short term loans include:
- In certain instances, they usually do not require collateral
- The funds are made available within 24 hours or more after applying
- Minimal paper work is required
- Such loans provide you with money when there is an unforeseen need
- You are not burdened with long term obligations
Loans over a short term, however, also present with some disadvantages such as:
- These type of loans being more expansive
- The loans are not secured by collateral which means the lender hikes the interest rates to cover their risk
- The lender will conduct a search on your credit history, and if your history proves good, the interest rates will be much lower
There are various lenders that provide loans that are inline with your budget and that also offer great loan terms and conditions. The principles behind loans that are short term are exactly the same as long term loans; the only difference is that you have to be paid back in a shorter time period such as up to one month.
Such loans are suitable for emergencies, as they are simple and quick to apply for and one can apply directly over the internet, of which the application takes a minute to complete. Once your application is accepted, the cash will be deposited into your banking account within 24 hours, and is accessible immediately.
If you need money today, know that a small cash loan is only a click away.